Indian budget airline IndiGo is likely to reap the rewards of its frugal business strategy when it launches on Tuesday an up to $465 million initial public offer in one of the world's fastest growing - and most competitive - aviation markets.
IndiGo, India's largest airline by passenger numbers, is the only consistently profitable local carrier for the past seven years, according to consultancy Centre for Aviation (CAPA).
For investors, this success in dodging the high operating costs and taxes that have over the past three years grounded debt-ridden Kingfisher Airlines and forced the bail out of budget airline SpiceJet Ltd makes IndiGo an attractive bet in a market where passenger numbers are growing at up to 18 percent a year, bankers say.
"They have figured out that people are more focused on getting to their destination on time than anything else. And they deliver that better than any airline," said Gaurav Narain at Ocean Dial Investments, a London-based India dedicated fund.
At $465 million, IndiGo's IPO would be the largest in India since 2012 and would give the company a market value of about $4 billion. Sources had earlier said the airline would sell shares worth up to $510 million.
26/10/15 Reuters/Economic Times
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IndiGo, India's largest airline by passenger numbers, is the only consistently profitable local carrier for the past seven years, according to consultancy Centre for Aviation (CAPA).
For investors, this success in dodging the high operating costs and taxes that have over the past three years grounded debt-ridden Kingfisher Airlines and forced the bail out of budget airline SpiceJet Ltd makes IndiGo an attractive bet in a market where passenger numbers are growing at up to 18 percent a year, bankers say.
"They have figured out that people are more focused on getting to their destination on time than anything else. And they deliver that better than any airline," said Gaurav Narain at Ocean Dial Investments, a London-based India dedicated fund.
At $465 million, IndiGo's IPO would be the largest in India since 2012 and would give the company a market value of about $4 billion. Sources had earlier said the airline would sell shares worth up to $510 million.
26/10/15 Reuters/Economic Times
